Union Investment has secured the rental income from the Galeria Karstadt Kaufhof flagship store in Essen for another ten years. The store is an important economic factor for Essen and was on the chain’s closure list for a long time.
This is also good news for UniImmo: Europa. The Karstadt store with an area of around 20,000 sq m was opened on the historic site of the original Karstadt building in 2008/2009 and has been the anchor tenant of the Limbecker Platz shopping centre for more than ten years. UniImmo: Europa has held a majority stake in the centre since 2006.
Following the fund’s acquisition of the 25 per cent share held by Karstadt in 2011, its holding rose to 85 per cent. The Otto family are among the holders of the remaining 15 per cent.
The centre is managed by ECE jointly with Union Investment. In addition to the lease with Galeria Karstadt Kaufhof, Union Investment has signed leases with Rewe, Saturn, Douglas, dm, Rossmann, C&A, McDonald’s and other tenants in the Limbecker Platz shopping centre over the past twelve months which collectively cover more than 20,000 sq m of rental space and run for five or more years. This means that excluding the Karstadt deal, more than 50 per cent of the space in the Limbecker Platz shopping centre is now let until at least 2025.
Lease for Hamburg-Wandsbek not extended – opportunities for Quarrée Wandsbek
The lease on the second Galeria Karstadt Kaufhof store in the Union Investment portfolio, located in the Wandsbek area of Hamburg, expires on 31 October 2020 and will not be extended. The property has been part of the UniImmo: Deutschland portfolio since 2004. Despite the offer of a substantial reduction in rent and an extension of the lease by ten years, the long-established business is set to close after many decades of trading. Union Investment is currently examining a number of options for attractive use of the vacant space (around 28,000 sq m) and intends to further strengthen Wandsbek as a retail location by offering new facilities.
The decision opens up new perspectives for the neighbouring Quarrée Wandsbek centre in particular, which also forms part of the UniImmo: Deutschland portfolio.
“Successful development of the Karstadt building offers the opportunity to sympathetically expand Quarrée Wandsbek in order to strengthen the overall location,” said Jörn Stobbe, managing director at Union Investment Real Estate GmbH.
The Hamburg-based real estate investment manager is currently carrying out extensive refurbishment of the shopping centre in Hamburg-Wandsbek, and is investing around EUR 40 million in the 40,000 sq m property. This could provide a template for the Karstadt property.